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DECREE

PROVIDING INVESTMENT AND ENTERPRISE INCOME TAX INCENTIVES FOR NEW ADMINISTRATIVE UNITS ESTABLISHED UPON ADJUSTMENT OF ADMINISTRATIVE BOUNDARIES BY THE GOVERNMENT

THE GOVERNMENT

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the November 29, 2005 Law on Investment;

Pursuant to the June 3, 200S Law on Enterprise Income Tax;

At the proposal of the Minister of Finance

DECREES:

Article 1. To provide investment and enterprise income tax incentives for new administrative units established upon adjustment of administrative boundaries by the Government as follows:

1. New administrative units, which are established under the Government's regulations on adjustment of administrative boundaries (division, separation or upgrading of former administrative units in geographical areas eligible for investment and enterprise income tax incentives) from the effective date of the Government's Decree No. 108/2006/ND-CP of September 22, 2006. detailing and guiding a number of articles of the Law on Investment but not yet included in the list of geographical areas eligible for investment incentives (promulgated together with Decree No. 108/ 2006/ND-CP of September 22, 2006) and the list of geographical areas eligible for enterprise income tax incentives (promulgated together with Decree No. 124/2008/ND-CP of December 11, 2008) are entitled to investment and enterprise income tax incentive policies currently enjoyable by geographical areas of former administrative units).

2. In case a new administrative unit mentioned in Clause 1 of this Article is recognized by the Government as a geographical area with difficult socio-economic conditions or with extremely difficult socio-economic conditions, it is entitled to investment and enterprise income tax incentives currently provided for such geographical area.

3. In case a new administrative unit mentioned in Clause 1 of this Article is established upon adjustment of boundaries of commune-level administrative units in geographical areas with difficult socio-economic conditions and those with extremely difficult socio-economic conditions, but it has no regulation on its investment and enterprise income lax incentives yet. it may enjoy investment and enterprise income tax incentives currently applicable to a majority (over 50%) of its commune-level administrative units. In case the numbers of commune-level administrative units in geographical areas with extremely difficult socio­economic conditions and those in geographical areas with difficult socio-economic conditions are equal, the new administrative unit is entitled to investment and enterprise income tax incentives currently applicable to geographical areas with extremely difficult socio-economic conditions.

4. In case the adjustment of administrative boundaries results in the transfer of a commune-level administrative unit from a geographical area on the list of geographical areas eligible for higher investment and enterprise income tax incentives (geographical areas with extremely difficult socio-economic conditions) to a geographical area eligible for lower incentives (geographical areas with difficult socio-economic conditions) or vice versa, the commune-level administrative unit is entitled to investment and enterprise income tax incentives applicable to the geographical areas to which it belongs.

Article 2. Implementation provisions

1. This Decree takes effect on July 15, 2010.

2. Ministers, heads of ministerial-level agencies and government-attached agencies and chairpersons of provincial-level People's Committees shall implement this Decree.